Don't get offloaded by your insurer, load-shedding battery warranties & how to protect geysers: Consumer watch-outs of the week
In this weekly segment of bite-sized chunks of useful information, consumer journalist Wendy Knowler summarises news you can use:
If your claims are adding up, best switch to another insurer
The advice that you shouldn’t claim on your insurance policy for small losses doesn’t sit well with many. “That’s what I’m paying premiums for every month,” they protest, and understandably so.
But too many claims can saddle you with what the industry terms a “poor claims ratio”, which could see them cancelling your policy.
Essentially, that means that in the previous three years, they’ve paid you — and the third parties in your car accident claim/s — more than you’ve paid them in premiums. And if your policy is cancelled as a result, you could battle to find alternative cover. If you do, it will come at a much higher premium because of your perceived high risk.
In a case which landed in my inbox this week, a man was “urged to seek alternative cover” by his insurer after lodging 10 claims in three years, including three car accidents and two burst pipes claims, totalling more than R195,000.
He’d paid about R67,000 in premiums in that time, meaning his loss ratio was 288% — not appealing to an insurer.
What to do to reduce your chances of being offloaded by your insurer:
- Never admit liability to any third party involved in an accident;
- Obtain as much information as possible from the third party before leaving the scene of the accident to help your insurance company in a successful recovery. The bigger the potential of recovery on claims, the lower the risk of cancellation; and
- It is often not worth claiming for “small stuff”, as it will affect your claims ratio.
Load-shedding blitzes battery warranties
Quite a few people have complained to me about being told by suppliers of batteries for alarm systems and such that batteries now only carry warranties for three months, not six, “because of load-shedding”.
The Consumer Protection Act (CPA) gives all products an “implied” six-month warranty, allowing consumers to return them within six months of purchase if they become defective, for their choice of a refund, replacement or repair.
The Act does give retailers and manufacturers an “out” if the consumer fails to use the product in the way it which it would “normally” be used.
It could be argued that ongoing scheduled blackouts, the frequency of which have escalated in the past year, have led to “abnormal” battery use. On the other hand, this is our new normal — and it’s predicted to worsen — so do suppliers now need to adapt to ensure that all the products they supply to market will be fit for purpose (in the context of South Africa) for at least six months?
I posed this question to Massmart’s senior VP for group corporate affairs, Brian Leroni and received this response: “Increased levels of load-shedding can affect the perceived performance of backup power products that use lead acid batteries.
“Most lead acid batteries are designed to last for about 150 cycles and have historically had a useful life of two to three years. However, under stage 4 to 6 load-shedding these 150 cycles are used in a considerably shorter period of time.
“But using the expected number of cycles within a shorter period is not considered to be a manufacturing defect.”
Nevertheless, battery returns numbers had not spiked in recent months, “as one might have expected”, Leroni said.
“But we have decided to engage proactively with suppliers ... about improving point of sale information to our customers ... with particular reference to the impacts of heightened levels of load-shedding,” he said.
Asked to comment, the Consumer Goods and Services Ombud said the issue was a tricky one because, as with the Covid-19 pandemic, the CPA was not drafted with extended load-shedding in mind.
“Our view is that these batteries are being used contrary to instructions because they are not designed to last with the number of hours of load-shedding that we have.
“There is no manufacturer’s defect, so in our view, suppliers may be validly excused from the section 56 warranty.
“The solution is not to stop selling the lower powered batteries,” the ombud said. “Consumers should still have the choice of what to buy, but we think they should be informed that the lead acid batteries have a reduced warranty and explain why, so that they can make an informed decision before they buy.”
Let’s hope we see that messaging on battery packs sooner rather than later.
But in winter, the temperature difference between the cold water entering the geyser and the hot water leaving the geyser is much greater, increasing the rate of expansion and contraction which can lead to geyser failureTyrone Lowther, Budget Insurance head
'Tis the season to get geyser wise
In winter, geyser claims increase by at least 30% and 98% of those claims relate to bursting or overflowing geysers, failing pipes or faulty equipment.
“Expansion and contraction of the geyser tank and its components occur during normal usage when hot water leaves the geyser and is replaced with cold water,” said Budget Insurance head Tyrone Lowther.
“But in winter, the temperature difference between the cold water entering the geyser and the hot water leaving the geyser is much greater, increasing the rate of expansion and contraction which can lead to geyser failure, especially if the geyser is older or if the valves or thermostat are faulty.”
- Have your geyser serviced by a qualified plumber every three years. Apart from draining it, checking the components and removing limescale and sludge, the plumber should also check that the thermostat temperature isn’t set higher than 60°C.
- Invest in a geyser blanket and timer, not only to save electricity, but to help avoid a burst geyser caused by extreme fluctuations in heating and cooling.
- Fit a drip-tray beneath the geyser. The outlet pipe on a drip-tray carries away most of the water should the geyser burst, helping limit water damage to walls, carpets and other home contents.
- If your geyser bursts, switch off the electricity mains immediately, turn off the water mains, and call your plumber and insurer. If your geyser is still under warranty, contact the manufacturer rather than claiming on your policy, to avoid having to pay an excess.
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